Submitted By: someone
Answered: June 1, 2022 2:45 am

I received a wrongful death settlement following the death of my relative. Is this taxable to me or to her estate?

A wrongful death settlement of compensatory damages is nontaxable because it is the result of a claim arising from personal physical injury or illness. However, if the settlement includes punitive damages and/or interest, that portion of the settlement is taxable.

Tax Glossary

Active participation

Test for determining deductibility of IRA deductions. Active participants in employer retirement plans are subject to IRA deduction phase-out rules if adjusted gross income exceeds certain threshold.

More terms